Hosted CRM Vendors Debate Multi-Tenancy

If you're a small business thinking about CRM software, isn't it nice to dream about the day that your business grows so large that vendors will start to fight about whether you've outgrown your hosted CRM solution? That's the debate that some CRM software providers have been having both internally and externally. Assuming that nearly all CRM applications will one day be accessed across networks instead of solely on the desktop, experts wonder whether single clients can sustain versions of hosted CRM systems that were intended for thousands of shared users?

Zoli Erdos picks up the debate on the Cloud Ave. blog, where some of his colleagues believe that Software as a Service can only encompass "multi-tenant" development plans. Many SaaS CRM systems make financial sense because significant maintenance, hosting, and security costs on a single server cluster can be shared among thousands of clients. For vendors that outsource storage and processing to cloud systems, like RackSpace or Amazon, servers themselves may not even exist in the forms to which we have become accustomed.

However, some of the biggest potential clients for hosted CRM systems have no real desire to see their data floating "on the cloud." They're happy to pay for secure, in-house hosting and development in exchange for assurances of tighter security and guaranteed uptime. The leveraged power of a SaaS application becomes tougher to manage when a company tries to scale its hosted CRM system to reach 99% uptime and beyond. As a result, some vendors choose to build server "pods" to handle single clients or small clusters of clients. Other vendors have focused instead on powerful computing arrays that leverage CPU time and storage across millions of simultaneous users.

The good news is, regardless of who is "right" in the ongoing debate, strong competition in the CRM software arena makes it easier and more affordable for companies of any size to take advantage of the latest tools and strategies for customer relationship management.